How Do Electronic Communication Networks (ECNs) Prevent Front-Running in Traditional Options? ⎊ Path

How Do Electronic Communication Networks (ECNs) Prevent Front-Running in Traditional Options?

ECNs use a strict, automated matching process, typically adhering to the price-time priority rule, to ensure fair and objective order execution. They also provide transparency by displaying the best available prices.

The automation and adherence to a strict algorithm prevent human intervention and the manual insertion of an order ahead of another, which is the mechanism for active front-running by a broker.

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